Argentina's Dairy Industry Overview
In 2023, Argentina remains a pivotal player in the global dairy sector, supported by a substantial dairy cattle population of approximately 1.6 million. The country produces around 10.5 billion liters of milk annually, highlighting its significant contribution to global dairy production.
Production and Processing
Argentina boasts a highly developed dairy processing infrastructure capable of handling around 9 billion liters of milk each year. This processing capability is vital for sustaining the sector’s success and meeting both domestic and international demands. The country is particularly renowned for its cheese production, generating approximately 500,000 metric tons annually, alongside 150,000 metric tons of milk powder and whey.
Key Enterprises and Dairy Farms
Major players within Argentina's dairy sector include companies such as La Serenísima (Mastellone Hermanos S.A.), Saputo Inc., and Williner. Prominent dairy farms like Tambos La Unión and Estancia La Nueva also significantly contribute to national milk production.
Exports and Imports
Argentina exports about 3.5 billion liters of dairy products annually, including liquid milk, cheese, and milk powder. This robust export capability ensures self-sufficiency and supports expansion into export markets, with increasing demand from China. However, imports from Germany have been suspended due to a Foot-and-Mouth disease alert.
Significant Market Events
The industry is navigating various challenges and changes, such as a change in Saputo Inc.'s Board of Directors. Despite a projected 7% decline in milk output for 2024, exports are expected to rise by 50%. The completion of the EU-Mercosur trade deal is anticipated to boost trade relations.
Outlook and Trends
Amidst challenges like rising production costs and climate disruptions, Argentina's dairy sector is set for growth. Innovations, such as robotic dairy farming in Tacural, Santa Fe, are promising. Reports from March 2025 show a nearly 16% increase in milk production year-on-year, with a projected annual growth rate of 6%. The trend towards fewer, larger dairy farms persists, with 90 closures in the first five months of 2025. As of 2025, only 9,039 dairy farms remain, down from 30,000 in 1988, with large farms now producing nearly 30% of the country’s milk.
International Engagement and Future Prospects
Argentina's involvement in the International Dairy Federation and efforts to reposition on the global dairy map are noteworthy. However, a strong peso is affecting export competitiveness, and crucial decisions regarding SanCor and Vicentin could shape the industry's future amidst significant debts and judicial proceedings.
Challenges and Innovations
A leading dairy company in Santa Fe faces a financial crisis with a debt exceeding 5.42 billion pesos, threatening jobs and halting milk processing. The role of cooperatives, emphasized by CAPROLECOBA, advocates for the removal of export duties to enhance income and encourage investment.
Organic and Artisan Trends
In General Rodríguez, an organic dairy supplies organic milk to Nestlé, highlighting Argentina's potential in the global market.
Cultural and Consumer Trends
The city of Tandil celebrated its Banquete Típico cheese being recognized as the best in the semi-hard cheese category, and a new ice cream flavor, chocolate and almonds, gained popularity, reflecting evolving consumer preferences.
Regional Support
Tucumán has extended tax benefits for its dairy sector until 2035, strengthening local production.
Conclusion
Despite inflation pressures and economic challenges, optimism prevails within the Argentine dairy industry, driven by favorable climatic conditions and innovative practices. The severe crisis facing Lácteos Verónica highlights broader economic challenges, yet stable growth in milk production solidifies Argentina's position as a key supplier. The unrest at the dairy plant in Suipacha, Buenos Aires, where employees seized control due to incomplete salary payments, underscores ongoing industry challenges. AI is redefining food production with innovations and challenges for Argentina's sector. Artificial intelligence has become a transformative tool in the agro-food industry of Argentina, promising to enhance efficiency and reduce waste.
The Argentine dairy industry is reclaiming its global significance amid reduced global milking cow numbers and record butter prices. After years marked by economic volatility and climatic challenges, the Argentine dairy sector is experiencing a robust resurgence, placing the nation back on the global map. In the first quarter of 2025, national dairy output rose by an impressive 10.9%, consolidating further with a 12% increase in the first half of the year. This positions Argentina as a leading dairy producer worldwide, particularly as other countries face herd reductions.
Argentina is facing challenges in milk production growth, expected to be less than half a percentage point. Argentina saw a rise in the volume of its dairy exports even as prices fell. The average price of Argentine dairy exports dropped by 1.67%, from USD 4,189.52 to USD 4,119.40 per ton, while the exported volume increased by 8.39%, from 11,546.61 tons to 12,516.64 tons. The number of export destinations remained relatively steady, dropping slightly from 31 to 30. Variations in the prices and volumes of different dairy products were noted, such as a slight price drop of 0.09% for Whole Milk Powder with an export amount of 4,666.68 tons.
Villa María is recognized as "the capital of milk in Argentina" and plays a strategic role in the Mercosur-EU agreement. Villa María's potential is driven by its prominence in dairy and agriculture, alongside local technological and educational advancements.
Modified: 2025/08/21